I'd really appreciate some advice on closing delays on our first

5 Replies

I would love some advice. We are in the middle of our first two properties. I should have already have closed on the first one. The other is right on track to close this week.

The unit had recently been remodeled and was empty when we saw it. We put an offer in that was not taken. The seller took another offer. That deal fell apart and our agent called right away and we put a cash offer in again which was accepted. We disapproved one of the tenants. Rather than cancel the contract the seller agreed to get him out. Paper work was redone that the unit must be vacant before purchase.  The seller assured he would be out. 

Our agent gave a window for closing that extended the original date out if necessary. Since it had just been inspected for the party with the previous offer or on it I got the same inspector. Basically we got the report and he went back with me to make sure the small items were cured. The tenant refused to let us in to the scheduled inspection.  Seller provided proof of payment and billing from the contractor that did the work. 

The seller had made an agreement with him to be out by the closing date. Then there was an excuse he couldn't move because of a health issue and couldn't physically do it. Landlord offered moving services at no charge. 

I do not think the seller is going to have this tenant out before the extended closing date we offered. If it passes that date we will be going into the cold weather season soon and people just don't move if it can be helped. We do not want to get stuck with an empty unit for the winter.  The original date would have had it rented before school started. 

I am obviously not a seasoned investor and have only bought my personal homes. Am I being unreasonable by refusing to go past the extended closing date on this property? As far as I am understanding the contact I am within rights to break it at that point and get our earnest $ back. I've got to talk to my agent about this yet.   Any advice??? 


 

Originally posted by @Michelle L. :

I would love some advice. We are in the middle of our first two properties. I should have already have closed on the first one. The other is right on track to close this week.

Yes, it is your right to cancel the deal if your contract says the unit must be vacant and it is not.  I see it as a small issue personally, but I bought properties in WI on Dec 1 last year and had four vacant units.  While it was not ideal, I got all four of them rented out by Jan 1

I would be more concerned with the quality of the deal.  If pushing the closing a few weeks was a deal breaker for me then the deal might have not been good enough to begin with.  Just my .02 

Thank you Brei.   To be honest we were dealing with another seller not marketing that wouldn't accept our offer. Right after we offered on the current property under contract she came back offering to accept. Since we already are working on two deals we had to decline. I did  prefer that property but $ wise the deals are about the same. 

It may be inexperience talking because I have zero but I have a feeling it will be a long process for the seller to get this tenant out.  I don't think their gentlemen agreement is going to do it.  As he already should have been gone at the landlords offer to pay to move him and is still there and 1st closing date past.  Upon my investigation and talking to the previous landlords I found with evictions on the tenant  the tenant seems to be a professional con man and loves law suits.  His criminal record was quite impressive. I don't want to be hanging out for months waiting for a formal eviction process with all this cash just sitting in the bank doing nothing. The other tenant was long term and checked out great. 

It is reassuring to know you got your property rented out in the winter no problems. 

Just an update. Closing was extended 4 times and we bailed. Perfect timing as two bargain gems came along equaling the price of the one we bailed on. I learned a lot from  the experience and am thrilled with the way it worked out. 

We see closing dates get moved around all the time, so that isn't too surprising.  But frankly I am surprised you waited around to be extended on four times.  That just seems excessive and would make me feel really squirrelly about the seller.  Glad it all worked out for you in the end.

Originally posted by @Matthew Vitlin :

We see closing dates get moved around all the time, so that isn't too surprising.  But frankly I am surprised you waited around to be extended on four times.  That just seems excessive and would make me feel really squirrelly about the seller.  Glad it all worked out for you in the end.

 Honestly we are not seasoned investors and were assured these things happen all the time. .Live and learn I guess. Now I know better. 

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